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OCC Charges against Ellsworth and Stevenson

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                             UNITED STATES OF AMERICA 

                            DEPARTMENT OF THE TREASURY 

                           COMPTROLLER OF THE CURRENCY 


In the Matter of:                                              )
                                                               )
Steven J. Ellsworth                                            )            AA-EC-11-41
Former Director and Chief Credit Officer                       )
                                                               )
Kevin W. Stevenson                                             )            AA-EC-11-42
Former Director and Chief Operations Officer                   )
                                                               )
Valley Capital Bank, N.A.                                      )
Mesa, Arizona                                                  )

           NOTICE OF CHARGES FOR PROHIBITION AND RESTITUTION
             NOTICE OF ASSESSMENT OF A CIVIL MONEY PENALTY

       Take notice that on a date as determined by the Administrative Law Judge, a hearing will

commence in Phoenix, Arizona, pursuant to 12 U.S.C. §§ 1818(b), (e), and (i), concerning the

charges set forth herein to determine whether Orders should be issued against Steven J.

Ellsworth former director and Chief Credit Officer and Kevin W. Stevenson former director and

Chief Operations Officer (collectively “Respondents”) of Valley Capital Bank, N.A. in Mesa,

Arizona (“Bank”), by the Comptroller of the Currency of the United States of America

(“Comptroller” or “OCC”), prohibiting each of the Respondents from participating in any

manner in the conduct of the affairs of any federally insured depository institution or any other

institution, credit union, agency or entity referred to in 12 U.S.C. § 1818(e), and requiring

Respondents to make restitution and pay civil money penalties.

       The OCC intends to order Respondents to reimburse the Federal Deposit Insurance Fund

for losses in the amount of eight-hundred-forty-seven-thousand dollars ($847,000), pursuant to

12 U.S.C. § 1818(b)(6), for which Respondents will be jointly and severably liable. Moreover,
after taking into account the financial resources, any good faith of Respondents, the gravity of

the violations, the history of previous violations, and such other matters as justice may require,

as required by 12 U.S.C. § 1818(i)(2)(G), and after soliciting and giving full consideration to

Respondents’ views, the Comptroller hereby assesses civil money penalties in the amount of

one-hundred-thousand dollars ($100,000) against each of the Respondents, pursuant to the

provisions of 12 U.S.C. § 1818(i). These penalties are payable to the Treasurer of the United

States.

          The hearing afforded Respondents shall be open to the public unless the Comptroller, in

his discretion, determines that holding an open hearing would be contrary to the public interest.

          In support of this Notice of Charges for Prohibition and Restitution, and Notice of

Assessment of a Civil Money Penalty (“Notice”), the Comptroller charges the following:

                                                Article I


                                           JURISDICTION


          At all times relevant to the charges set forth below:

           (1)   The Bank was a national banking association, chartered and examined by the 


 Comptroller, pursuant to the National Bank Act of 1864, as amended, 12 U.S.C. § 1 et seq. 


           (2)   The Bank was an “insured depository institution” as defined in 12 U.S.C. 


 § 1813(c)(2) and within the meaning of 12 U.S.C. § 1818(i)(2). 


           (3)   The OCC is the “appropriate Federal banking agency” within the meaning of 12

 U.S.C. § 1813(q)(1) and for purposes of 12 U.S.C. § 1818(b), (e), and (i) to initiate and 


 maintain enforcement proceedings against an institution-affiliated party. 





                                                    2

       (4)    Respondent Ellsworth is a former director, Chief Credit Officer, and “institution-

affiliated party” of the Bank as that term is defined in 12 U.S.C. § 1813(u), having served in

such capacity within six (6) years from the date hereof (see 12 U.S.C. § 1818(i)(3)).

       (5)    Respondent Stevenson is a former director, Chief Operations Officer, and

“institution-affiliated party” of the Bank as that term is defined in 12 U.S.C. § 1813(u), having

served in such capacity within six (6) years from the date hereof (see 12 U.S.C. § 1818(i)(3)).

       (6)    Respondents are subject to the authority of the Comptroller to initiate and

maintain prohibition, restitution, and civil money penalty proceedings against them pursuant to

12 U.S.C. §§ 1818(b)(6), (e), and (i).

                                           Article II


                                         BACKGROUND


       (7)    In or around January 2007, Respondents created PCBA Acquisitions LLC

(“PCBA LLC”) to be the corporate entity through which Respondents would effectuate the

purchase of Premier Commercial Bank of Arizona, N.A. (predecessor to the Bank).

Respondents were the sole owners and officers of PCBA LLC.

       (8)    In September 2007, Respondents incurred personal debts of at least $2,220,004 as

part of their effort to purchase Premier Commercial Bank of Arizona, N.A. from its controlling

holding company.

              (a)    Respondents borrowed $920,000 from another bank ("Lender 1"). This

              loan was a seven-year, variable rate, interest-only loan, with interest payments

              due monthly.

              (b)    Respondents borrowed $500,000 from an individual (“Lender 2”). This

              loan was a three-year loan with principal and interest due on maturity.

                                                3

             (c)    Respondents borrowed $500,000 from another individual (“Lender 3”).

             Respondents promised Lender 3 that they would repay the principal on this loan,

             as well as $50,000 in interest and fees, within three calendar months after

             obtaining the loan.

             (d)    Respondents borrowed $220,000 from a husband and wife (“Lender 4”).

             Respondents promised Lender 4 that they would repay the principal on this loan,

             as well as $22,000 in interest and fees, within three calendar months after

             obtaining the loan.

             (e)    Respondents committed to reimburse an $80,004 investment in Bank

             stock made by a future Bank employee (“Employee A”). Subsequent to the

             investment, Employee A requested and Respondents agreed to pay Employee A

             interest on the $80,004 investment.

       (9)   The transaction through which Respondents purchased Premier Commercial Bank

of Arizona, N.A. closed on or about September 21, 2007.

       (10) In October 2007, Respondents renamed Premier Commercial Bank of Arizona,

N.A. as Valley Capital Bank, N.A. (the “Bank”).

       (11) Respondent Ellsworth served as director and Chief Credit Officer of the Bank

during September 2007 through at least June 2009. Respondent Stevenson served as director

and Chief Operations Officer of the Bank during September 2007 through at least June 2009.

Respondents’ employment with the Bank terminated in August 2009.




                                              4

        (12) On December 11, 2009, the Bank was closed and placed into receivership with

the Federal Deposit Insurance Corporation.

        (13) At all relevant times, Respondents were voting members of the Bank’s Loan

Committee and Board of Directors (“Board”).

        (14) At all relevant times, Respondents were executive officers of the Bank as that

term is used in 12 U.S.C. § 375a, 12 C.F.R. Part 215.

        (15) Executive officers of a bank are prohibited from receiving general purpose

extensions of credit from that bank in excess of $100,000, pursuant to 12 U.S.C. § 375a and 12

C.F.R. Part 215. Additionally, 12 U.S.C. § 375a(1) and 12 C.F.R. § 215.5(d) require that all

extensions of credit to executive officers be promptly reported to a bank’s board of directors.

        (16) As directors and executive officers of the Bank, Respondents were obligated to

comply with all applicable laws and regulations, and to carry out their duties and

responsibilities in a safe and sound manner. In addition, Respondents owed fiduciary duties of

care and loyalty to the Bank, which included an obligation to act with the care and prudence

that a reasonable person would exercise under similar circumstances, an obligation to avoid

conflicts of interest, and an obligation to place the interests of the Bank ahead of their own

personal interests at all times.




                                                5

                                           Article III


               RESPONDENTS MADE UNSAFE OR UNSOUND LOANS 

                   IN VIOLATION OF LAW AND IN BREACH 

                  OF THEIR FIDUCIARY DUTY TO THE BANK


       (17) This Article repeats and realleges all previous Articles in this Notice.

       (18) During the period of September 2007 through at least June 2009, Respondents

used Bank funds to repay personal debts and obligations that they had acquired jointly as part

of their efforts to purchase Premier Commercial Bank of Arizona, N.A.

A.    Loans to Employee B

       (19) In October 2007, Respondent Ellsworth negotiated an employment offer to a

future Bank employee (“Employee B”) that included an offer for the Bank to loan Employee B

$500,000 for the purpose of buying Bank stock.

       (20) The Bank hired Employee B as Senior Vice President and National Manager of

Commercial Real Estate Lending for the Bank pursuant to the employment offer Respondent

Ellsworth negotiated. Employee B was an executive officer of the Bank as that term is defined

by 12 C.F.R. § 215.2(e).

       (21) In December 2007, Respondents approved two loans to Employee B for the

purpose of purchasing Bank stock. The loans totaled $500,000.

       (22) The first of the two loans made to Employee B was a ten-year, interest-only loan

for $350,000 that was secured by the Bank stock obtained in connection with the loans. The

second loan was a twelve-month, interest-only loan for $150,000 that was secured by a second

lien on Employee B’s personal residence.




                                                6

       (23) On December 18, 2007, Respondents caused the proceeds of the loans to

Employee B ($500,000) to be directly deposited into PCBA LLC’s account at the Bank.

       (24) Thereafter, on December 19, 2007, Respondents caused the Bank to wire

$500,000 from PCBA LLC’s account to Lender 3’s personal account at another financial

institution in repayment of the principal of the $500,000 loan that Respondents personally owed

to Lender 3.

       (25) The loans to Employee B exceeded the $100,000 limit for general purpose loans

to executive officers of the Bank and were not reported to the Board, and Respondents failed to

disclose to the Board their personal interest in the loans.

       (26) In January 2009, Respondents approved a $500,000 loan to the Bank’s President

and Chief Executive Officer (hereinafter “President”). The Bank’s President used the proceeds

of the $500,000 loan to purchase Bank stock from Employee B and repay the $500,000 in loans

that the Bank made to Employee B.

B.    Loans to Employee C

       (27) In December 2007, Respondents persuaded another Bank employee (“Employee

C”) to obtain a $220,000 loan from the Bank to purchase Bank stock. Respondents assured

Employee C that he would not have to repay the loan.

       (28) Employee C was a Senior Vice President, Commercial Loan Officer, and an

executive officer of the Bank as that term is defined by 12 C.F.R. § 215.2(e).

       (29) On December 14, 2007, Respondents approved two loans, totaling $220,000, to

Employee C.



                                                 7

       (30) The first of the two loans made to Employee C was a six month loan for $168,000

for which principal and interest were due on maturity and that was secured by the Bank stock

obtained in connection with the loans. The second loan was a six month loan for $52,000 that

was secured by a second lien on Employee C’s personal residence, and for which principal and

interest were due on maturity (collectively “$220,000 Loans”).

       (31) On December 18, 2007, Respondents caused the proceeds of the loans to

Employee C ($220,000) to be directly deposited into PCBA LLC’s account at the Bank.

       (32) Thereafter, also on December 18, 2007, Respondents caused the Bank to wire

$220,000 from PCBA LLC’s account to Lender 4’s personal account at another financial

institution in repayment of the principal of the $220,000 loan that Respondents personally owed

to Lender 4.

       (33)    In August 2008, the Bank renewed the $220,000 Loans to Employee C.

Respondent Stevenson was loan officer on the renewals.

       (34) The loans to Employee C were not reported to the Board and exceeded the

$100,000 limit for general purpose loans to executive officers of the Bank, and Respondents

failed to disclose their personal interest in the loans to the Board.

       (35) As a result of the foregoing conduct related to the $220,000 Loans, Respondents

caused false entries to be made in the Bank’s books and records, and embezzled, abstracted,

defrauded and/or willfully misapplied Bank funds.

       (36) The $220,000 Loans to Employee C were never repaid, resulting in loss to the

Bank of at least $220,000.




                                                 8

       (37) By reason of the foregoing conduct, Respondents engaged in violations of law

and regulation, including 12 U.S.C. §§ 83 and 375a, and 12 C.F.R. Part 215; engaged in

reckless unsafe or unsound practices in conducting the affairs of the Bank; and/or breached

their fiduciary duties to the Bank as directors and executive officers. Respondents also acted

with personal dishonesty and a willful and continuing disregard for the safety or soundness of

the Bank that constituted a pattern of misconduct, during an extended period of time, that

caused the Bank loss and from which they received an economic benefit. Additionally, by

reason of Respondents’ foregoing conduct related to the $220,000 Loans to Employee C,

Respondents violated 18 U.S.C. §§ 656 and 1005.

                                          Article IV

                        RESPONDENTS MISAPPROPRIATED 

                     BANK FUNDS TO REPAY PERSONAL DEBTS 


       (38) This Article repeats and realleges all previous Articles in this Notice.

       (39) In December 2007, Respondents caused the Bank to make two wire transfers,

totaling $72,000, from the Bank’s capital surplus account to repay funds that Respondents

personally owed to Lenders 3 and 4.

       (40) On December 19, 2007, Respondents caused the Bank to wire $50,000 from the

Bank’s capital surplus account to the personal account of Lender 3 to pay the $50,000 in

interest and fees that Respondents personally owed to Lender 3.

       (41) Also on December 19, 2007, Respondents caused the Bank to wire $22,000 from

the Bank’s capital surplus account to the personal account of Lender 4 to pay the $22,000 in

interest and fees that Respondents personally owed to Lender 4.


                                               9

         (42) As a result of the foregoing conduct, Respondents embezzled, abstracted,

defrauded and/or willfully misapplied $72,000 in Bank funds. The Bank sustained a loss of

$72,000.

         (43) By reason of the foregoing conduct, Respondents violated 18 U.S.C. § 656;

engaged in reckless unsafe or unsound practices; and/or breached their fiduciary duty to the

Bank. Respondents also acted with personal dishonesty and a willful and continuing disregard

for the safety or soundness of the Bank that caused the Bank loss, from which they received an

economic benefit.

                                            Article V

                  RESPONDENTS CAUSED FRAUDULENT PAYMENTS 

                       TO BE MADE TO BANK EMPLOYEES 


         (44) This Article repeats and realleges all previous Articles in this Notice.

         (45) During the period of September 2008 through February 2009, Respondents

approved fraudulent payments to Employee A and Employee C.

A.      Fraudulent Payment to Employee A

         (46) In July 2008, Employee A emailed Respondents to request receipt of interest

payments on her $80,004 investment in Bank stock pursuant to the prior commitment

Respondents had made to Employee A.

         (47) In September 2008, Respondents caused the Bank to pay a “one time merit

bonus” of $8,900 to Employee A.

         (48) Respondents fraudulently used the “one time merit bonus” to Employee A to

conceal their use of Bank funds to pay interest to Employee A for her $80,004 investment in the

Bank.


                                                10

B.    Fraudulent Payments to Employee C

       (49) In September 2008, Respondents caused the Bank to pay a “one time merit

bonus” of $14,700 to Employee C.

       (50) Respondents used the "one time merit bonus" to Employee C to conceal their use

of Bank funds to make interest payments due on the $220,000 Loans.

       (51) In August 2008, the Bank discontinued the Loan Officer 2008 Incentive Program

through which Employee C was eligible to earn bonuses.

       (52) However, in November/December 2008, Respondents caused the Bank to pay

$6,900 to Employee C pursuant to the discontinued Loan Officer 2008 Incentive Program.

       (53) Again, in February 2009, Respondent Ellsworth caused the Bank to pay $4,500 to

Employee C pursuant to the discontinued Loan Officer 2008 Incentive Program.

       (54) Respondents fraudulently used the purported bonus and incentive payments to

Employee C to conceal their use of Bank funds to make interest payments due on the $220,000

Loans Employee C obtained from the Bank at Respondents' request.

       (55) In February/March 2009, the Board replaced the Bank’s President.

       (56) Under the Bank’s new president, Respondents were no longer able to conceal

their use of Bank funds, pursuant to the discontinued Loan Officer 2008 Incentive Program, to

make interest payments due on the $220,000 Loans.

       (57) Accordingly, in June 2009, Respondent Stevenson assigned Employee C a special

project to be performed outside of work hours that would enable Employee C to earn enough

money to pay the interest due on the $220,000 Loans.




                                             11

       (58) After Employee C completed the special project, Respondent Stevenson directed

Employee C to overstate the hours worked by Employee C to ensure that the payment would be

sufficient to pay the interest due on the $220,000 Loans.

       (59) In June 2009, Respondent Stevenson approved an overpayment to Employee C of

approximately $1,279 based on the overstated hours worked on the special project.

       (60) As a result of the foregoing conduct, Respondents caused false entries to be made

in the Bank’s books and records related to certain bonus and incentive payments made to

Employees A and C, and embezzled, abstracted, defrauded, and/or willfully misapplied

approximately $36,279 in Bank funds.

       (61) Respondents caused the Bank to sustain losses of approximately $36,279 related

to the fraudulent payments to Employee A and Employee C.

       (62) By reason of the foregoing conduct, Respondents violated 18 U.S.C. §§ 656 and

1005; engaged in reckless unsafe or unsound practices in conducting the affairs of the Bank;

and/or breached their fiduciary duties to the Bank as directors and executive officers.

Respondents also acted with personal dishonesty and a willful and continuing disregard for the

safety or soundness of the Bank that constituted a pattern of misconduct, during an extended

period of time, that caused the Bank loss and from which they received an economic benefit.

                                           Article VI

           RESPONDENTS APPROVED A LOAN TO BANK’S PRESIDENT

           IN VIOLATION OF LAW AND REGULATION AND IN BREACH

                  OF THEIR FIDUCIARY DUTY TO THE BANK


       (63) This Article repeats and realleges all previous Articles in this Notice.




                                               12

       (64) In late June or early July 2008, Employee B had a meeting with Respondents in

which Employee B and Respondents mutually agreed that Employee B would resign his

employment with the Bank.

       (65) At this meeting, Respondents agreed to locate individuals willing to purchase the

Bank stock from Employee B and thereby, repay Employee B’s $500,000 loan from the Bank.

       (66) Thereafter, Respondents asked the Bank’s President to purchase the Bank stock

from Employee B and agreed to finance the $500,000 purchase through a Bank loan.

       (67) The Bank’s President was an executive officer of the Bank as that term is defined

in 12 C.F.R. § 215.2(e), and therefore was prohibited from obtaining a $500,000 general

purpose loan from the Bank pursuant to 12 U.S.C. § 375a and 12 C.F.R. Part 215.

       (68) In January 2009, Respondents voted to approve an unsecured, $500,000 twelve-

month loan to the Bank’s President.

       (69) Consistent with his agreement with Respondents, the Bank’s President used all of

the proceeds of the loan ($500,000) to purchase Bank stock from Employee B.

       (70) At the February 2009 Board meeting, Respondents, as members of the Board,

ratified the $500,000 loan to the Bank’s President. Also at the February 2009 Board meeting,

the Board voted to remove the Bank’s President from his employment at the Bank.

       (71) Thereafter, the Bank’s former President failed to repay the $500,000 loan he

owed the Bank, resulting in loss to the Bank of at least $500,000.

       (72) By reason of the foregoing conduct, Respondents engaged in violations of law

and regulation, including 12 U.S.C. § 375a and 12 C.F.R. Part 215; engaged in reckless unsafe

or unsound practices; and/or breached their fiduciary duties to the Bank as directors and



                                              13

executive officers. Respondents also acted with personal dishonesty and a willful and

continuing disregard for the safety or soundness of the Bank that constituted a pattern of

misconduct, during an extended period of time, that caused the Bank loss and from which they

received an economic benefit.

                                            Article VII

RESPONDENTS APPROVED IMPERMISSIBLE GOLDEN PARACHUTE PAYMENTS

       (73) This Article repeats and realleges all previous Articles in this Notice.

       (74) In March 2009, Respondents approved entering into a severance agreement with

the Bank’s former President that committed the Bank to make three (3) payments of $10,000

each to the former President.

       (75) In March and April 2009, the Bank paid $10,000 to its former President for a total

of $20,000.

       (76) On May 18, 2009, the OCC sent a letter to the Board, informing the Board that

the severance agreement between the Bank and former President resulted in impermissible

golden parachute payments. As a result of the letter, the Bank did not make the final $10,000

payment to its former President.

       (77) Respondents caused the Bank to sustain a loss of $20,000 related to the severance

agreement with the Bank’s former President.

       (78) By reason of the foregoing conduct, Respondents caused the Bank to violate 12

U.S.C. § 1828(k) and 12 C.F.R. Part 359, prohibiting impermissible golden parachute

payments; engaged in unsafe or unsound practices; and/or breached their fiduciary duties to the

Bank as directors and executive officers.



                                                14

                                          Article VIII


                RESPONDENTS MADE FALSE STATEMENTS 

        DURING THE COMPTROLLER’S INVESTIGATION OF THE BANK


       (79) This Article repeats and realleges all previous Articles in this Notice.

       (80) On or about September 19, 2007, Respondents signed a promissory note in which

Lender 2 agreed to loan Respondents $500,000, and Respondents committed to repay those

funds to Lender 2 plus interest within three years.

       (81) On May 13, 2010, the OCC took the sworn testimony of Respondent Ellsworth in

the agency’s Phoenix, Arizona field office.

       (82) On May 14, 2010, the OCC took the sworn testimony of Respondent Stevenson in

the agency’s Phoenix, Arizona field office.

       (83) During their respective sworn statements, both Respondent Ellsworth and

Respondent Stevenson denied that they borrowed funds from Lender 2.

       (84) In addition, in a letter to the OCC dated March 31, 2010, Respondent Ellsworth

stated that he “was not a borrower, co-borrower, guarantor, or co-signer” for any loan during

May 1, 2006 through March 17, 2010.

       (85) In September 2010, subsequent to their respective sworn statements, Lender 2

contacted Respondents via electronic mail to coordinate repayment of the $500,000 loan.

       (86) Respondents both responded to Lender 2 via electronic mail regarding repayment

of the $500,000 loan. At no point in their electronic communications with Lender 2 did

Respondents deny the existence of the loan from Lender 2.

       (87) By reason of the foregoing conduct, Respondents deliberately made false

statements to the OCC regarding the loan they obtained from Lender 2.


                                               15

       (88) Respondents’ false statements to the OCC in May 2010, in part, impeded the

agency’s investigation of Respondents’ conduct, were an unsafe or unsound practice, and

violated 18 U.S.C. § 1001.

                                          Article IX


                         LEGAL BASES FOR REQUESTED RELIEF


       (89) This Article repeats and realleges all previous Articles in this Notice.

       (90) By reason of Respondents’ misconduct as described in Articles III through VIII,

the Comptroller seeks a Prohibition Order against Respondent pursuant to 12 U.S.C. § 1818(e)

on the following grounds:

             (a)     Respondents violated laws and regulations, including 12 U.S.C. §§ 83,

             375a, and 1828(K), 18 U.S.C. §§ 656 and 1005, and 12 C.F.R. Part 215 and Part

             359; engaged in unsafe or unsound practices in conducting the affairs of the Bank;

             and/or breached their fiduciary duties to the Bank as directors and executive

             officers.

             (b)     Respondents received personal financial gain or other benefit and caused

             financial loss to the Bank by reason of their misconduct.

             (c)     Respondents’ violations, unsafe or unsound practices, and/or breaches of

             fiduciary duty involved personal dishonesty and demonstrated a willful or

             continuing disregard for the safety or soundness of the Bank.

       (91) By reason of Respondents’ misconduct as described in Articles III through VIII,

the Comptroller seeks imposition of a civil money penalty against Respondent pursuant to 12

U.S.C. § 1818(i) on the following grounds:



                                              16

               (a)    Respondents violated laws and regulations, including 12 U.S.C. §§ 83,

               375a, and 1828(K), 18 U.S.C. §§ 656, 1001, and 1005, and 12 C.F.R. Part 215

               and Part 359; engaged in recklessly unsafe or unsound practices in conducting the

               affairs of the Bank; and/or breached their fiduciary duties to the Bank as directors

               and executive officers.

               (b)    Respondents’ violations, practices, and/or breaches of their fiduciary duty

               were part of a pattern of misconduct that resulted in pecuniary gain or other

               benefit to the Respondents and more than minimal loss to the Bank.

        (92) By reason of Respondents’ misconduct as described in Articles III through VIII,

 the Comptroller seeks an Order for Restitution against Respondents pursuant to 12 U.S.C. §

 1818(b)(6)(A) on the following grounds:

               (a)    Respondents violated the law, including 12 U.S.C. §§ 83, 375a, and

               1828(K), 18 U.S.C. §§ 656 and 1005, and 12 C.F.R. Part 215 and Part 359; and

               violated their common law fiduciary duty; and engaged in unsafe or unsound

               practices in conducting the affairs of the Bank.

               (b)    Respondents’ violations and/or unsafe or unsound practices involved

               reckless disregard for the law and applicable regulation and/or resulted in

               Respondents’ unjust enrichment.

                             Answer and Opportunity for Hearing

       Respondents are directed to file a written answer to this Notice within twenty (20) days

from the date of service of this Notice in accordance with 12 C.F.R. § 19.19(a) and (b). The

original and one copy of any answer shall be filed with the Office of Financial Institution



                                                17

Adjudication, 3501 North Fairfax Drive, Suite VS-D8113, Arlington, VA 22226-3500.

Respondents are encouraged to file any answer electronically with the Office of Financial

Institution Adjudication at ofia@fdic.gov. A copy of any answer shall also be filed with the

Hearing Clerk, Office of the Chief Counsel, Office of the Comptroller of the Currency,

Washington, D.C. 20219, Hearing.Clerk@occ.treas.gov, and with the attorney whose name

appears on the accompanying certificate of service. Failure to answer within this time period

shall constitute a waiver of the right to appear and contest the allegations contained in this

Notice, and shall, upon the Comptroller's motion, cause the administrative law judge or the

Comptroller to find the facts in this Notice to be as alleged, upon which an appropriate

order may be issued.

       Respondents are also directed to file a written request for a hearing before the

Comptroller, along with the written answer, concerning the Civil Money Penalty assessment

contained in this Notice within twenty (20) days after date of service of this Notice, in

accordance with 12 U.S.C. § 1818(i) and 12 C.F.R. §§ 19.19(a) and (b). The original and one

copy of any request shall be filed, along with the written answer, with the Office of Financial

Institution Adjudication, 3501 North Fairfax Drive, Suite VS-D8113, Arlington, VA 22226-

3500. Respondents are encouraged to file any answer electronically with the Office of Financial

Institution Adjudication at ofia@fdic.gov. A copy of any request, along with the written answer,

shall also be served on the Hearing Clerk, Office of the Chief Counsel, Office of the Comptroller

of the Currency, Washington, D.C. 20219, Hearing.Clerk@occ.treas.gov, and with the attorney

whose name appears on the accompanying certificate of service. Failure to request a hearing




                                                 18

within this time period shall cause this assessment to constitute a final and unappealable

order for a civil money penalty against Respondent pursuant to 12 U.S.C. § 1818(i).

                                   PRAYER FOR RELIEF

       The Comptroller prays for relief in the form of the issuance of an Order of Prohibition

pursuant to 12 U.S.C. § 1818(e); an Order Requiring Restitution in the amount of eight-hundred-

and-forty-seven-thousand dollars ($847,000), for which Respondents Ellsworth and Stevenson

are jointly and severably liable, pursuant to 12 U.S.C. § 1818(b)(6); an Order of Civil Money

Penalty Assessment in the amount of one-hundred-thousand-dollars ($100,000) against each of

Respondent Ellsworth and Respondent Stevenson pursuant to 12 U.S.C. § 1818(i).



       Witness, my hand on behalf of the Office of the Comptroller of the Currency, given at

Washington, D.C. this __6th___ day of August, 2011.



/s/ Henry Fleming

Henry Fleming
Director for Special Supervision




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